Nevada adopts emergency marijuana rules amid fears of imminent weed shortage

Nevada Wholesaler Steps Up to Restock Dispensaries

Nevada Wholesaler Steps Up to Restock Dispensaries

The Nevada Tax Commission was scheduled to consider a new regulation Thursday in Carson City to license some pot retailers to serve as their own middleman if there aren't enough alcohol distributors to do the job.

The problem: All cannabis sold at recreational dispensaries in Nevada must be shipped there by a licensed distributor, and according to the language in Nevada's successful legalization ballot measure, the only qualified companies happened to be liquor wholesalers.

The referendum passed a year ago by Nevada voters legalizing the drug for recreational use stipulated that for the first 18 months of sales only liquor wholesalers would be allowed to apply to distribute marijuana - a nod to the powerful alcohol industry, which is anxious about new competition from pot.

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A lawyer for the alcohol wholesaler groups that won the court order told the tax panel that he's convinced the new regulation is illegal. Kevin Benson stopped short of threatening another lawsuit, but said he's convinced the emergency rules would be invalid. Rather, a statement of emergency allows for swift changes in regulations during temporary scenarios, said Mari St. Martin, communications director of the Office of Governor Brian Sandoval, in a statement. Contine said the department has issued two total licenses to alcohol wholesalers, but the other five submitted incomplete applications. When sales began July 1, retail shops - all of which were already selling marijuana for medical use - had to rely on their existing stocks, which soon started to run low.

Tax commissioners charged with enforcing the unusual administrative structure that has led to a distribution bottleneck got their first real taste of the potential crisis at retail dispensaries during a three-hour hearing on Thursday. State officials are expecting sales to top $30 million by the end of 2017, making a licensed distributor all the more important in the coming weeks. The state awarded its first distribution license to Crooked Wine Company, which has partnered with a medical marijuana logistics company to transport recreational weed from farm to store.

Nevada's distribution woes are unique among states that have legalized the sale of recreational marijuana.

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A Carson City judge ruled last month that alcohol wholesalers have exclusive rights to transport pot from growers to store fronts for the next 18 months.

The tax department director, Deonne Contine, said that of the almost 70 liquor wholesalers in Nevada, seven had applied to transport marijuana.

Following an overwhelming demand for recreational marijuana, Nevada regulators are considering emergency rules that would expedite licensing for pot distributors.

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This created a lawsuit that almost delayed the opening of the first retail shops, as alcohol wholesalers fought medical marijuana distributors for the right to produce and distribute cannabis for Nevada's legal market.

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